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Family, friends, journalists, potential investors and palm
readers will tell your idea is brilliant or foolish but they
don’t really know. Very few ideas are clearly amazing.
The success of most ideas is very much unclear.

So, how can you find out if your startup idea is good or bad?

Fortunately, there are people out there who can definitively
tell if your idea is good or bad. They are brutal, selfish and
don’t really know what they want. But, if you put a version
of your startup idea in front of them, they’ll either use it or
quickly lose interest.

Those people are your potential users. The people whose
problem you’re solving and they alone, through their action or
inaction, will tell you if your startup idea is good or
bad.

The problem is that it takes months to get a working
prototype ready. Well, not if you are ready to take a few
shortcuts.

The Idea

In late January of this year, we had noticed two things:
people loved Groupon and there were, at that point, around
15 competing daily deal services of which 7 had launched in the
last 30 days.

The problem we identified was two-fold: people didn’t want to
sign-up for all these new deal services getting 15 emails a day
and didn’t want to keep getting deals that weren’t relevant to
them (e.g., guys didn’t want spa deals).

We wanted to create a product that would allow users to tell us
what kind of deal categories they wanted (restaurants, not spas),
every day we would grab all of these new daily deals announced in
their market, filter the deals based on the user’s preferences
and email the best ones in just one email.

How We Tested It

We could have sat around for a few months asking people what they
thought, writing a business plan, modeling out what it would like
in five years, thinking about where our headquarters would be,
and other irrelevant things.

Or, we could create a very simple prototype as fast as
possible. We could see if potential users would sign-up.
And, if they did, whether they would open our daily emails, click
on the deals or just unsubscribe from our emails.

Building a Prototype in Three Days

We had a long list of features we wanted for Yipit but we cut
everything except for the bare minimum:

Landing page to sign-up

Page to collect category preferences

Page to recommend Yipit to others

Page where you could see all of the deals in our system

In retrospect, we could have done without creating the page where
a user could browse all of the current deals.

On the back-end, we needed:

Script that would send out a daily email with the deals that
matched their preferences

Crawler to grab all the deals from the various sites and put
them in our database

All of the above is actually very easy to build. The only
problematic one was the crawler to grab the deals from the
various third-party sites. Each site was different, the
urls were weird, duplicate deals would be a problem and
categorizing the deals accurately is a hard problem to solve.
We quickly realized the crawler was going to take us
weeks to build poorly and months to build correctly.

But, what we concluded was that the whether we could build the
crawler wasn’t a risk. We could; it would just take time.
The real risk was that people didn’t want to use our
service.

The Shortcut

So, we said, screw it, we’re not building a crawler.
We’re just going to do the deal entry manually and
eventually build the crawler if people actually liked our new
service.

We created a simple admin page where a deal could be entered in
(title, picture, price, etc.). We then hired a part-time person
who would wake up every morning, go to the 20 daily deal sites
and manually type the deals into our system and assign them to
categories like restaurants, massage, spa, etc. Crazy? Yes.
Scalable? Probably not. Did it matter? No.

Finding Out If Our Idea Was Bad

Three days later, we were ready to put our prototype in front of
potential users. Much to our delight, people started signing-up
and started getting and clicking on our email. They were
implicitly telling us they liked our idea! (I’ll write a future
post on how to get these early users but basically you get them
wherever you can. You don’t need that many to know if your idea
is good or bad).

If people hadn’t signed-up or hadn’t clicked on our emails, we
would have found out right away that there was something wrong
with our idea. But, that would have been okay because we
hadn’t spent months on it; just a few days.

How to Find Out if Your Idea is Good or Bad

My main pieces of advice are:

Build a very simple prototype for your idea
and get it in front of potential users. You’ll learn more the
day you talk to your first user than the months you’ve spent
pontificating

Don’t be afraid to do things manually at
first like we did

Build a landing page with screenshots that describe
your future product and see if people will sign-up for
your invite list. Dropbox did that before they had a product and
signed-up 100K people. Clearly, they were solving a problem
people had!

Cut every feature except for the core feature.
Seriously, you don’t need any of those extra features.

95% of startups are able to have a prototype built in
less than two weeks.

Don’t write a business plan.

It’s very likely your idea is bad. Find that out as soon
as possible so you can evolve it to a better idea.